• 18% of the World’s Super-Rich Work for Goldman Sachs Cryptocurrency as an Inflation Hedger

  • More family offices are turning to cryptocurrencies as a viable hedge against inflation, currency debasement, and unanticipated macroeconomic events, according to a recent poll from Goldman Sachs.

    The survey included more than 150 family offices from throughout the world. 15 percent of the respondents already own cryptocurrencies (25 percent of American respondents), while 40 percent are concerned about currency depreciation.

    45 percent of those concerned about debasement want to learn more about crypto as a viable inflation hedge.

    Meena Flynn, a partner at Goldman Sachs and co-head of private wealth, told us that the “majority of families” want to talk to the bank about blockchain technology because they believe it will have the same impact as the internet.

    However, many family offices aren’t convinced. On the most pessimistic end of the spectrum, 47 percent of American family offices say cryptocurrency isn’t a good store of value, while only 24% of Asian respondents agree.

    Family offices are notorious for their secrecy. A family office is essentially an asset management firm, similar to Blackrock or the crypto-focused Grayscale, but one that only manages the fortune of a single ultra-wealthy individual and his or her family.

    22 percent of the family offices that responded to the poll had $5 billion in assets, while 45 percent managed $1 billion to $4.9 billion.

    The study came a few months after Goldman Sachs published a research paper concluding that cryptocurrencies are a genuine asset class. “Clients and beyond are mainly treating [Bitcoin] as a new asset class, which is noteworthy—not it’s often that we get to witness the creation of a new asset class,” the bank said in May.

    Only a year ago, Goldman Sachs stated unequivocally that cryptocurrencies were not a viable investment class.

    This 180-degree shift by one of the world’s major banks and its clients is a strong indication that nothing will be able to stop crypto’s rapid ascent into the global financial system.

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